Germany’s Economy Shrinks 0.3%, Triggering Calls for Reform

Germany’s economy has experienced a contraction, shrinking by 0.3% in the second quarter of 2025, according to official figures. This decline has raised pressure on Chancellor Friedrich Merz’s government to implement reforms and address the underlying economic challenges. While finance minister Lars Klingbeil pledged to advance key reforms before the end of 2025, the nation grapples with weak manufacturing and declining consumer spending as a result of US tariffs impacting exports.